*

Peru's central bank cuts benchmark interest rate to 6%

*

Colombia inflation to fall at slower rate in coming

months:

policymaker

*

Brazil's services activity unexpectedly down in February

*

Argentina's inflation data on tap

*

Latam stocks down 1.3%, FX down 1.1%

By Bansari Mayur Kamdar

April 12 (Reuters) - Currencies in Latin America fell on

Friday and were on track for their worst weekly performance

since October as the dollar rallied after this week's red-hot

U.S. inflation print eroded hopes the Federal Reserve would cut

rates in June.

The MSCI index for Latin American currencies

fell 1.1% and was set to end the week 1.4% lower.

Denting investor appetite for riskier emerging market

assets, the U.S. dollar soared after stronger than

expected U.S. consumer prices data on Wednesday and commentary

from Fed officials saying there is no rush to cut interest

rates.

Leading regional losses, Mexico's peso dropped 1.6%

against the dollar. In a volatile week, the peso briefly hit its

highest level since 2015 before retreating and heading for its

worst weekly performance so far this year.

"This is partly just a reflection of the fact that Latin

American central banks have had a bit more space to ease and

some of this modest weakness we've seen this week is a bit of a

reversal of the incredible strength," said Rachel Ziemba,

founder at Ziemba Insights.

"We're entering into this important period for the peso with

the election campaign and with the dynamics with the central

bank."

Peru's sol bucked weakness in the region, inching

higher after its central bank cut the benchmark interest rate to

6.00% on Thursday, from a previous rate of 6.25%.

This marked a return to monetary easing in Peru after a

surprise hold last month hit pause on a series of cuts that

began last September.

Also in focus, Peru's Congress approved a proposal on

Thursday that will allow retirees to tap savings accounts that

the financial regulator estimated could force pension fund

administrators to sell some $7 billion in assets.

Stocks in the South American country inched 0.4%

up.

Argentine investors awaited inflation data due later in the

day that is expected to show consumer prices rose by 12% in

March, the pace declining for the third straight month.

The South American nation is battling inflation that is

running on an annual basis above 275%.

Argentina's central bank cut its benchmark interest rate by

10 points to 70% on Thursday, the third adjustment since

libertarian President Javier Milei took office in December.

Brazil's real shed 0.9% against the greenback and was

set for its sixth straight week lower.

Activity in Brazil's services sector fell 0.9% in February

from the previous month, data showed, missing analyst forecasts.

The Colombian peso fell 1.2% against the dollar.

Colombia's inflation rate will fall at a slower pace in the

coming months but will reach the central bank's target by

mid-2025, bank board member Olga Lucia Acosta said.

El Salvador priced a six-year, $1 billion note yielding 12%

to be issued next week, underwritten by Bank of America

Securities, LSEG data show.

Meanwhile, in Asia, central banks of Singapore and South

Korea keep monetary policy unchanged earlier in the day.

The broader emerging market currencies index

fell 0.5% to its lowest level since January, while stocks

shed 1.3%

HIGHLIGHTS:

** Vietnam central bank to increase gold bar supplies to

stablise market

** Argentina's government (and a bot) say inflation is

easing. Shoppers aren't so sure

** Indian voters want jobs, price reduction - survey

** India's March retail inflation eases to five-month low

Key Latin American stock indexes and currencies at 1443 GMT:

Stock indexes Latest Daily %

change

MSCI Emerging Markets 1041.38 -1.3

MSCI LatAm 2486.60 -1.27

Brazil Bovespa 127181.19 -0.17

Mexico IPC 56883.60 0.09

Chile IPSA 6646.39 -1.19

Argentina MerVal 1260695.66 0.111

Colombia COLCAP 1410.52 -0.33

Currencies Latest Daily %

change

Brazil real 5.1383 -0.95

Mexico peso 16.7028 -1.61

Chile peso 961.2 -0.68

Colombia peso 3871.8 -1.30

Peru sol 3.7076 -0.80

Argentina peso (interbank) 866.5000 -0.06

Argentina peso (parallel) 975 2.56

(Reporting by Bansari Mayur Kamdar in Bengaluru)